Cryptococcus neoformans is one of the most serious fungal pathogens affecting primarily immunocompromised individuals such as those with AIDS. It is a unicellular budding yeast which is surrounded by a thick polysaccharide capsule. The fungus is neurotropic and causes meningoencephalitis that is fatal unless treated. Considerable progress in the identification of genes associated with pathogenicity and virulence of C. neoformans has been made in this laboratory. During the previous five years, three capsule genes have been identified and characterized asvc essential for virulence of the organism. During 1997, we have cloned the fourth gene, CAP10, which is also essential for capsule formation as well as virulence. In addition, we have investigated the STE12&#61537;&#61472;gene in the MAP kinase pheromone response pathway for its role in the regulation of virulence factors of C. neoformans. It was found that S&#61524;&#61509;&#61489;&#61490;&#61537;&#61472;&#61472;regulates the expre ssion of all four CAP genes and the CNLAC1 gene which is also a virulence factor of the organism. A STE12&#61537;&#61472;&#61472;knock-out strain was significantly less virulent than an isogenic wild type strain.